JOHANNESBURG: South Africa's rand strengthened two percent against the U.S. dollar on Monday as concerns over a failed coup attempt in Turkey eased and investors sought out higher returns in emerging markets.
Stocks ended slightly lower with gold shares among the biggest decliners as traders pared their safe-haven holdings after Turkey's government said it was in control of the country and the economy.
At 1549 GMT, the rand traded at 14.267 versus the dollar, 2 percent stronger than last Friday's close.
"We believe it is an exaggeration to believe the political noise in Turkey may affect the general price dynamics in other major emerging markets, especially the high-yielding ones," Citi said in a note.
Foreign investors have been net buyers of South African assets so far this year, splashing out nearly 115 billion rand ($8 billion) on bonds and equities, a near two-fold increase on the same time a year go.
On the debt market, government bonds weakened, with the yield for benchmark 2026 debt down 12 basis point to 8.85 percent.
On the bourse, the blue-chip JSE Top-40 index edged down 0.05 percent at 46,431 and the broader All-share index lost 0.08 percent to 53,046.
Volumes were low with 152 million shares changing hands, about half last year's average daily trading volumes of 296 million shares.
AngloGold Ashanti dropped 1.65 percent at 299.06 rand and rival Harmony Gold was 1.8 percent lower at 63.22 rand.
Spot gold fell to a session low of $1,323.43 an ounce and was down 0.7 percent at $1,327.11 by 1529 GMT. Bullion fell over 2 percent last week, its first weekly decline in seven weeks, as investors piled cash into riskier assets.
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